Shoe Dog By Phil Knight
Just Do It.
That’s a phrase we’ve all heard before. And, it was made famous by Nike.
This catchy three-word phrase captures the ignitive fiery spirit of Phil Knight when he first founded Nike.
In “Shoe Dog” Knight shares his secrets for success through the telling of his untraditional business building.
“I’d tell men and women in their mid-twenties not to settle for a job or a profession or even a career. Seek a calling. Even if you don’t know what that means, seek it. If you’re following your calling, the fatigue will be easier to bear, the disappointments will be fuel, the highs will be like nothing you’ve ever felt.”- Phil Knight
You’ll be inspired by Knight’s creativity and honesty as he points you in the direction of entrepreneurial success through his well-crafted memoir.
It All Starts With A “Crazy” Idea
Phil Knight graduated from business school in 1962. He was 24. At the time, he was not a people-person. In fact, he was terribly shy.
But, Knight had this concept of importing Japanese-style running shoes to America. The name-brand he had in mind was Tiger, which was a smaller part of the big-name Japanese brand Onitsuka.
“History is one long processional of crazy ideas.”- Phil Knight
Knight was so determined to snag this opportunity that despite his terrible sales skills, boarded a plane to Japan to pitch to a room of Japanese businessmen. Not only was the deal sealed, but Knight explains that traveling became one of the biggest inspirations for his future business projects.
When he shipped out to Japan, Knight was holding a loan from his Dad in order to extend his journey around the world. He traveled with a college-friend of his from Hawaii to Asia to the Middle East and Europe. He famously visited Greece where he beheld the Temple of Athena Nike. And, this was long before Nike was even a seed of a company!
His courageous leap landed him a deal and had him untraditionally selling Tiger shoes out of the trunk of his car while working as an accountant for half of a year.
Knight argues that having inspiration in your life and a mentor can propel your dreams forward. Knight’s personal inspiration was his college track coach, Bill Bowerman.
Bill, like Knight, was a “shoe dog”. A “shoe dog”, in the industry, is a person who is literally shoe-obsessed and believes that the right shoe can lead a person confidently in the direction of their dreams.
Bowerman, as a coach, believed the shoe made the difference. And, he would have Knight try different footwear in order to observe his performance.
Bowerman always wanted to make shoes as light as possible for his athletes, so he would often tear shoes apart and put them back together. Bowerman was basically a footwear designer himself!
Knight secured a deal with Onitsuka for exclusive rights to distribute Tiger footwear in the US. Again, he did this with the financial help of his father and bank loans.
The Tiger shoes were sold at track meets and through word-of-mouth. Print advertisements were also drawn up.
On a trip to Japan, in order to continue having exclusive distribution rights for Tiger shoes in the US (rather than losing them to his former coach, Bowerman) Knight decided to climb Mt. Fuji, where he met a woman named Sarah, who shortly-after became his partner. Though, the long-distance in the US eventually terminated the relationship. But, Knight kept the rights!
Knight asked Bowerman to partner with him at Blue Ribbon, his footwear start-up. Bowerman, naturally agreed, and the cooperation was highly successful as Bowerman was training Olympians at the time, so publicity was booming.
The Truth About Employees
Knight emphasizes that to have a successful business, your employees must be creative and eccentric. Knight hired people he knew, including his sister as a part-time secretary and his college track friend Jeff Johnson.
Johnson was a strong salesperson, but it often clashed with Knight’s ideology of management. And, while this was happening, tensions were high as the bank claimed that Knight was not as successful financially as he should be.
In his short-lived accounting career, Knight met Delbert Hayes who became a business mentor and guide for Knight. And, at the same time, in 1964 Knight’s coach Bowerman began collaborating with Onitsuka on designs for US running sneakers.
Jeff Johnson’s booming sales led to Knight opening a store in Oregon. But, news broke that someone was trying to compete and steal away their customers, so Knight once again flew to Japan to get a handle on the situation. While there, he claimed to a lead at Onitsuka that he was running offices on the East Coast when he actually wasn’t. In fact, those offices didn’t even exist!
After he flew back to the states, Knight quickly sent Jeff to open a store on the East Coast outside of Boston. Knight hired retired track stars to pose as salespeople at the store.
Bowerman designed a brand new shoe with Onitsuka which was set to launch at the 1968 Olympic games. Their factory operations were then moved by Knight to an old shabby warehouse.
Knight quit his accounting job and took up teaching the subject of accounting at Portland State University. He met a student by the name of Penelope Parks and he gave her the job of bookkeeper of his passion project Blue Ribbon. Eventually, the two entered a romantic relationship and were later married.
In 1969, Knight quit teaching to go full-time with his baby, Blue Ribbon. The heads of Onitsuka visited their US offices while Knight and Parks were newlyweds on a tight budget. When Parks became pregnant, the two bought a house and new offices. Parks had a baby boy.
The Blue Ribbon team was a quirky group that worked exceptionally well together. They were able to look past the flaws and see the genius and knowledge within each other, which naturally, helped power the company as a whole.
Knight also discusses improving team morale by bonding and enlisting employees to partake in company decisions. He explains that showing that you care about what your employees have to say is important to running a successful company.
Though Nike is an unstoppable force, it has definitely had to overcome its obstacles, which as Knight explains, is inevitable once fame and fortune become a reality to a company.
Blue Ribbon’s contract was not being renewed by Onitsuka. But, Onitsuka was not reliable with their shipments, which was a problem as the demand for these shoes was rising. Knight was at a loss when the banks wouldn’t loan him any more money. So, once again, his dad swooped in and loaned him $8,000.
Knight believed by showing the heads of Onitsuka the Blue Ribbon operation that they would remain to let him exclusively distribute their product. However, that was not the case as Onitsuka intended to meet with many other companies about distribution.
At the end of the trip, the heads of Onitsuka offered to buy Blue Ribbon at the same time the bank ended its relationship with the Blue Ribbon company. However, Knight enlisted a line of credit from other bankers willing to do business.
Nissho Iwai, a trading company of Japan, agreed to back the Blue Ribbon company loans. This is when Nike was born as they needed a new brand name to make their own line of shoes.
Knight even let Jeff Johnson, name the company Nike when the company decided to brand its own shoes and say ‘goodbye’ to Onitsuka.
Nike began with factories in both Mexico and Japan. And, they were previewed at the Chicago National Sporting Goods Association Show. The crowd was impressed!
Nike began receiving endorsements from athletes, which helped to boost its popularity.
“When you see only problems, you’re not seeing clearly.”- Phil Knight
Two lawsuits almost killed Knight’s footwear career. But, Nike persevered because of Knight’s belief in the success and honesty of his company.
The first was when Onitsuka filed a suit against Blue Ribbon in Japan. In retaliation, Blue Ribbon filed a suit against Onitsuka in the US. Throughout this time-consuming debacle, Parks had her and Knight's second son.
Blue Ribbon came out on top of their US lawsuit when Onitsuka was found guilty of trademark violation.
All businesses will go through trials and speculations, but it’s important to remain strong and believe in your company fully. This was the case in many stages of the Blue Ribbon company.
In 1975, Bowerman sold most of his stake in Blue Ribbon to Knight and the company was renamed, Nike.
Grow Or Die
Knight ran his company with the mantra “grow or die”. He invested all the money his company made, minus what he was paying his employees, to grow the company bigger and bigger.
“Life is growth. You grow or you die.”- Phil Knight
This was definitely a struggle as Knight was facing financial troubles following the previously mentioned lawsuits.
In 1977, a genius idea was brought to Knight’s attention by an aerospace engineer to put air into the soles of Nike sneakers. Also during that year, Nike’s competitors worked to have the US Customs Service send Nike a massive bill for $25 million claiming they violated the American Selling Price. Knight, of course, traveled to D.C. to try to eliminate this fee. Knight ended up paying only $9 million as the government charged him with an anti-trust lawsuit.
By, 1980 Knight was back at the top, and his shares grew to a whopping $178 million. And, by 2007 Nike was the head of sportswear!
One of the big things that Knight emphasizes is to treat setbacks as a challenge. It should not be discouragement and they should be approached head-on with creative energy.
Another value of Nike is treating his employees well. Nike is currently working hard to set higher standards for the factories in which their employees work, while also raising the pay.
Having a heart and believing in your company is what makes it successful, stands out, and a great place to work. Knight emphasizes his dedication to the history and culture of Nike throughout all of its trials and errors.
The Main Take-Away
Nike started with some creative “crazy” ideas that formed into a successful company full of heart and dedication. By thinking creatively and believing in his dreams, Knight created a global company worth admiring.